Invest in TEDA, Invest in the Future

December 16, 2013

On the heels of two decades of rapid growth, the priorities of China’s economy are starting to shift. The country is putting more emphasis on sustainable growth and its domestic market—focusing on industries that are sustainable, creative and innovative. Economic zones that hope to thrive are working to balance the old with the new. Few are doing it as successfully as the Tianjin Economic-Technological Development Area—one of China’s longest-established special economic zones.

Tianjin Economic-Technical Development Area

Tianjin Economic-Technological Development Area (TEDA) was first established in 1984, on a wave of economic reform promoted by Deng Xiaoping. It was one of a series of statelevel development zones opened early to international investment. At the time, it was hoped these zones would attract foreign direct investment and promote a model of economic growth based on strong manufacturing and international trade. Today, TEDA is a powerhouse, pushing local GDP to 200 billion RMB (US$32 billion) in 2012 and creating more than 700 billion RMB (US$114 billion) of industrial output.

TEDA’s success is due both to the area’s location and its continued, forward-looking investments. Last year, the area won accolades from the Chinese Ministry of Commerce for its comprehensive investment environment—the 15th year in a row it has been ranked number one out of 90 state-level industrial zones in China. As TEDA has expanded its scope over the years, the development area has taken steps to strengthen its roots in manufacturing, while growing to accommodate the new demands of the Chinese economy.

A Growing List of Industry Expertise

When TEDA first opened its doors in 1984, it was intended to be a leader in the country’s four most forward-looking industries: electronics, machinery, automotive and food and beverage. Over nearly three decades, as the development area has evolved, it has expanded the number of industries it supports to include aerospace, finance, petrochemicals, bio-pharmaceuticals, as well as new energy and new materials.

TEDA is a powerhouse located in North China.

TEDA has also made strides in expanding its R&D capabilities and encouraging the addition of small and medium-size hi-tech companies. Today, R&D and incubation facilities consume 9,000 square meters of floor space, and there are 2,800 hi-tech SMEs operating in the area.

TEDA has managed to achieve such impressive growth while continuing to invest in its original core industries, enabling resident companies to tap the expanding network of upstream and downstream industries. For example, in the automotive sector, Volkswagen initiated a mega-scale advanced manufacturing operation in TEDA in 2012. TEDA is home to six automotive research institutes—two of which are domestically funded and four of which are foreign-funded, independent research institutes. These centers have succeeded in developing a range of technologies, including breakthroughs in vehicle shock-absorption, noise-reduction and other technologies that improve the function of pure electric and hybrid vehicles.

With forward-looking policies, TEDA also has been able to anticipate trends in the Chinese economy. The area was early to adopt energy-saving and environmentally friendly industries and take measures to increase the sustainability of its own operations.

TEDA was named a pilot zone for Environmental Management by the State Environmental Protection Agency in 2001, and by the UNPE in 2002. TEDA has since worked to improve energy efficiencies and set up a material recycling model for other industrial parks. TEDA also has focused resources toward creating a water-recycling program and built an integrated water utilization system for desalinated seawater, wastewater and reused gray water. Residents in the area also benefit from China’s first man-made wetland, which uses recycled water as a supplementary source.

Expanding Infrastructure

The founders of TEDA set their stakes in the middle of a salt flat along China’s Bohai Bay. The location was selected for its proximity to Tianjin’s Port on Bohai Bay, an easy outlet for shipping exports across the world. As the area has expanded, its accessibility to a range of transportation options has made it ideal not only for exporting companies, but for companies looking to access China’s domestic market, particularly in the north of China.

TEDA is a connecting hub for many of China’s high-speed train lines. It is close to Beijing and a number of other Hebei metropolises. The Beijing-Tianjin intercity high-speed trains and more than ten highways link TEDA to over the rest of the country. TEDA also is serviced by the Tianjin Binhai International Airport, the air-freight base and main passenger airport in North China. In addition, TEDA is only a ten-minute from Tianjin Port, the biggest port in North China with links to some 400 ports in more than 180 countries and regions.

The area is further expanding its facilities for the petrochemical industry within the Nangang Industrial Zone. In 2012, a total of 4.323 billion yuan (US$705 million) was invested in the area for this purpose.

Nangang Industrial Zone: TEDA’s new venture

According to current plans, Nangang’s port will offer two basins capable of accommodating vessels up to 50,000 tons in the near future, to be upgraded to 100,000 tons by its completion. In addition to the port, Nangang benefits from all the advantages of its location on the Bohai Sea.

As China’s economy shifts, TEDA’s continued investments are helping prepare the development area to shift along with it—providing better access to the domestic market and offering better resources for research, development and innovation. With each improvement, every corporation and industry with a base in TEDA gains more room to innovate and expand its business.